Good tech for FAST times

With spiking subscriptions costs Free Ad Supported TV services become more and more attractive, DTVE reports on how to tackle the changing market.

Having piled into streaming services during the pandemic, consumers facing huge pressure on the household purse will increasingly seek out free streaming video options. That’s prompted a rash of ad-supported launches of which Apple TV+ 2023 launch is the latest.

Yet according to a survey of US consumer streaming behaviour by Penthera, 40% of AVOD customers would stop using a service because of a poor experience like start-up delays or buffering. Some 43% of online video viewers report that annoying or repetitive ads would make them stop using an ad-supported platform.

There a complex and necessary series of technology components required to get this right.

“The ad tech must support latency and fill rate optimisation as a priority, while also offering a brand safe advertising experience,” says Daniel Wohlfart, principal product manager, advanced advertising at Synamedia. “To launch FAST channels quickly, without risk and at the lowest cost, an important consideration is using just-in-time processing to make sure only the segments or streams that are actually requested are processed.”

The first generation of FAST channels were almost all based on playout and encoding technologies. While functional, this combination of technologies has several major drawbacks.

“For services not needing overlay graphics, it is overkill,” says Olivier Karra, SaaS Solutions marketing director at Broadpeak. “Moreover, it is resource hungry, limits personalisation and is quite costly compared with the alternatives.”

Olivier Karra

The main technology components to set up monetisation of FAST channels are the dynamic (or server side) ad insertion (DAI) provider, ad server and supply side platform (SSP), accompanied by a direct access to campaigns with demand side platforms (DSP).

Sebastian Manemann, principal product manager, Synamedia, says, “The FAST business model is about remonetising content, hence the very tight relationship with ad insertion – in fact, you can think of dynamic ad insertion (DAI) as the ‘A’ in FAST. By adding DAI, operators can tailor the ad placement to a very granular level and maximise the revenue per ad placement.”

DAI and manifest manipulation are the fundamental pillars of FAST 2.0. They enable contextualisation of content for all streaming workflows while boosting monetisation. All ad-supported workflows, including FAST, AVOD, and SVOD ad-supported tiers can benefit from DAI.

“Dynamic Ad Insertion is a triple win,” says Karra. “Advertisers can target and reach the right audience more efficiently. Viewers get more relevant ads and in a more controlled way (e.g., with frequency capping). Furthermore, all parties including streaming service providers, supply-side platforms, ad servers, SSAI technology providers, and publishers share better CPM values.”

Using DAI specifically solves the problem of ad blockers being used on the client side. In addition, it enables quality of service consistency between ad creatives and content when using programmatic ad inventory sale.

“Manifest manipulation is not only a requirement for ad monetisation but also a critical path for stream delivery and user experience,” says Laurent Potesta, CEO at DAI services specialise Ad Insertion Platform (AIP). “If it fails, it will impact the user stream delivery and destroy the user experience.”

Karra doubles down on this point: “Fundamentally, manifest manipulation is considered the most efficient and functional way to cost-effectively offer personalisation at scale. FAST is a use case that can fully leverage those opportunities. DAI and manifest manipulation allow content providers, right holders, and publishers to get a larger share of the CPM-based revenue while offering a better viewing experience.”

Patrick Knippel

FAST ecosystem

To establish an infrastructure that quickly delivers visible results to content rights holders, Patrick Knippel, co-Founder and MD at ad-insertion platform developer nowtilus.tv, says it will be crucial to open up the FAST ecosystem. “This results in a fair and efficient end-to-end value chain which maintains transparency, measurability and optimised revenue for rights holders. It will also be important to work with skilled ad sales teams who understand the content and the environment to enable best fitting monetisation on the ground.”

Media agencies are restructuring their teams to remove TV and digital silos and operate in a more holistic manner, in tune with the reality of a complex and growing AV ecosystem.

“As advertisers seek better value for their marketing investments against inflated costs, and as audiences splinter across devices and platforms, media agencies will need to adapt,” Kantar advises.

This is likely to mean further investment in digital skills, with an emphasis on tech, data, analytical and mathematical experience, and potentially restructuring teams to take the necessary holistic approach to video planning that merges linear broadcast with online video.

“It will also require discarding rivalries between digital and AV teams and an end to siloed channel planning,” Kantar notes.

With third party cookies phasing out a growing number of countries have started to enforce protection of personal private data. In Europe, for instance, streaming service providers must comply with General Data Protection Regulation (GDPR) and therefore collect an explicit opt-in consent from end users. Similar rules apply with CCPA, for instance, in California.

“That means supply-side platforms will not return any targeted ad if the IAB consent string is not collected and forwarded,” informs Karra. “In this case, non-targeted or default ads can be used, but this is a fallback strategy.”

As ad opportunities are a finite resource, adding targeting will always mean there’s a possibility of reducing the number of possible impressions to a level where you risk the success of the campaign. The challenge, according to Wohlfart, is therefore to make sure you use targeting wisely, in combination with available yield optimisation features, to ensure a healthy business outcome.

Personalisation

FAST, AVOD, and ad-supported SVOD players can move beyond content-based targeting and locality-based targeting to a more personalised proposition – but there are caveats.

“Provided all the necessary consent mechanisms in place, personalised targeting – in combination with classic contextual targeting – makes it possible to elevate CPMs/revenue on an existing ad opportunity pool,” says Wohlfart.

Laurent Potesta

Potesta agrees, “as long as platforms get consent from users, GDPR laws and privacy rules do not block platforms or content providers from offering personalised content to users. Proposing personalised content will gain even more interest from users than getting personalised ads. As a result, combining them will make it easier to get global consent since the user will receive added value.

“The main challenge for AVOD and FAST ad inventory is to be able to reach the same level of targeting that advertisers want. Building first-party data, to face the user data challenge in the current GDPR and privacy law environment, is the best way to be able to propose an attractive inventory. Connecting content data in the adtech chain is also a good option to re-enable targeting options for example.”

Knippel believes FAST actually has the potential to finally connect content owners’ “well-structured knowledge about their video assets to valuable viewer insights gathered on the consumer-facing platforms.”

Dynamic product placement – enabling a product, billboard or screen featured in content to be substituted or overlaid with a different brand or advert – is growing. Like addressable advertising, different viewers could – with the right data – be shown tailored ads.

However, technological possibilities will need to be balanced against what’s acceptable to audiences. A negative impact may be inadvertently achieved if a placement is clearly anachronistic, jarring or out of place. “Tailored content should be closely monitored,” Kantar warns.

“The OTT streaming industry has reached a point where viewers consider private and personal data as too sensitive to be shared without usage guarantees, even for free services,” says Karra. “They want to know who is going to use their data, for what purpose, and who is it going to be shared with. Providers must first demonstrate a genuine approach with a clear and explicit message on how personal and private data is going to be used, before going to the next level. They need to initiate a phased trust cycle before they can ask for more data.”

While the US is a few steps ahead of Europe in terms of FAST deployment the EMEA industry arguably has the chance to get the connection right between insights gathered on the platforms and their “transparency-compliant transfer” through the value chain all the way to the advertiser.

“Only this will lead to marketers fully capturing the potential of CTV’s youngest offspring and finally shifting budgets from classic broadcast TV to digital linear streaming in a way that reflects its value and reaches a broader audience,” says Knippel. “With CTV being an ecosystem majorly focused on first party data and GDPR compliant consent collection steadily improving, FAST channels fit right in to utilise the insights of their host platforms without disturbing privacy violations.

Since dynamic ad insertion, technically enabled by manifest manipulation, are the essential components connecting the content to monetisation opportunities, rights owners are advised to pay special attention to finding vendors with the right expertise in ad integration.

“Anything else would lead to limiting the demand potential to whatever walled gardens grow in their backyard, opposed to flexibly opening up their inventory to the raising interest in CTV and its different flavours,” Knippel says.